20.08.21
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Transparency, or a lack thereof, is among the most glaring issues faced by the music industry and those who chose to make their living – and their mark – as artists and music-makers in 2021. Shady record deals, systematic racism and historical inequalities continue to make headlines. As do streaming woes and label-artist battles surrounding creative control and ownership. Some of these have been made public in recent months, while others have played out behind the scenes. However, with more eyes on such topics, clarity on internal processes like company structures and revenue payouts is something both musicians and consumers are increasingly demanding (and expecting) from the companies they interact with.

In response to changing times, and a shift towards a more independent artist ecosystem, organisations like AWAL, Kolbalt, Sentric Music and HIFI – a financial rights organisation set up solely for the music industry – have blossomed and evolved into modern music firms designed to cater to new demands. This year, several other companies such as BMG and Sony Music Entertainment (which, in fact, acquired AWAL from Kobalt back in February) have vowed to rectify some of their historical practices and contracts, especially those unfair to Black artists.

These pledges and commitments arrive in response to last year’s events: the murder of George Floyd, waves of global Black Lives Matter protests, and a divisive industry ‘Blackout’ Day. All happening during the pandemic – where the shuttering of the night time economy, no touring and gigging, and in turn, live revenue – meant that artists were truly going through it. In 2021, the likes of Spotify and SoundCloud, or even smaller, DIY labels like London’s Circadian Rhythms, have taken steps to offer new insight into how their businesses operate. And as transparency steadily increases sector-wide, artists and aspiring industry professionals can better decide which roles they want, or the directions they wish to take.

As mentioned, Circadian Rhythms is an imprint and multidisciplinary crew who prioritise forward-facing, club-centric music from artists like Plata, Inner or even co-founder Last Japan himself. That’s alongside techy, sustainable clothing collections, parties and innovative physical releases, like EPs distributed on USB cards.

Earlier this year, Circadian – which is currently helmed by Last Japan and Escha (real names Marco and Will) – announced that it was undergoing an internal restructure in order to “better respond to the state of the music industry”. As a DIY venture helmed by a close-knit team, their practices, and indeed motivations, already took a more artist-friendly tack. The label’s roster remained fairly slim, with the pair’s time and resources channelled into the small pool of acts who released via the label or played at its parties. 

Instead, the area of the business they sought to revolutionise was their release model. “We now have very lenient terms on how an artist can distribute their release, including them being able to sell on their own channels, retain 100 percent of the revenue and have full autonomy of how their music is distributed,” Marco and Will explain over email. “Also, all artists will regain the full recording rights of their music after a maximum of three years, as opposed to most labels, even in the underground electronic scene, having a hold on an artist’s music for a lifetime. We even have contracts on our website for people to preview.”

As the pair outline on social media, their approach has been led by the current industry climate and the changing role of record labels at all levels, be it DIY, independent or major. “If you look around, most artists release their own music now,” they state. “They don’t need record labels anymore who are going to take fifty-percent-plus of their profits and retain the rights to their own music for a lifetime. Artists know this model is outdated and exploitative, you hear about it in the news all the time; artists getting stuck in awful contracts. As a record label, we realised we needed to make changes and propose a framework for how record labels of the future could run.”

 

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Butterz, the London-based DIY label formed in 2010, perhaps set the precedent for this style of label-artist relationship. “The whole process of getting a record into the world is a creative one,” says co-founder Elijah, who’s been working with UK charity Youth Music this year as project lead on its new NextGen Fund for aspiring young creatives. “So, with artists being part of the whole journey of it, you are getting more complete versions of their vision, rather than them just handling the music and someone else doing the rest. I enjoy that as a fan.”

Both Butterz and Circadian Rhythms have found success through utilising the very essence of what they are: DIY. As smaller labels, they can take brave leaps of faith, or develop their roster without being subject to the rigidity and long-standing structures maintained by their major label counterparts. In many ways, they – and others like them – are perhaps best placed to steer the course into future iterations of the music industry, and help support artists who aren’t being served, or are being unfairly served elsewhere.

 

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BIMM Institute, or the British and Irish Modern Music Institute, is Europe’s largest music education provider. Specialist courses range from songwriting and electronic music production through to areas like music business. Mark Bowers is Head of Music Industry and Artist Development at BIMM Institute Bristol. He also manages rising acts at Crosstown Concerts, the UK-based concert promotion company that launched a management division back in 2018. 

As someone well-acquainted with the music industry, Bowers reflects on the trends that he’s seen firsthand: the shift from major label dominance to the proven successes of more independent entities has been happening for some time now. For Bower, the major change happened when major labels – hamstrung by the shift to digital downloads – stopped investing in new artists, at least to the same degree they did in previous decades. “When things started to go digital, they didn’t have the revenue to keep that kind of development. And so it forced people to go DIY and build themselves,” he says. “That trend has continued and actually works in favour of new artists; all the artists I work with are at that stage.”

It’s a model that seems to be working for AJ Tracey: an independent artist basking in commercial success. This year, he released his second album Flu Game, which debuted at number two in the UK album charts, announced a UK-wide arena tour, and jumped aboard the TikTok train. Tracey’s early releases include a collab with Last Japan, and he’s also played a Butterz night before, way back when.

Flu Game was distributed via Supernature, a holistic artist and label management company helmed by Andy Musgrave, who is also Tracey’s manager. Through the company, Musgrave – who used to run the club-night-turned-label Crazylegs – intended to support the artists he was already managing on a freelance basis. Today, the label exists as all of the above, while also offering a stack of in-house services: “marketing, creative, distribution, merch, sync…” lists Musgrave, “with more being added all the time.” 

Over the years, Supernature has worked with artists such as Sega Bodega and Murlo, however Tracey remains its most visible success. And as the visibility of commercially successful independent artists such as Tracey continues to increase, it will inevitably give emerging artists more confidence in taking the same path. 

Over in the electronic music realm, there’s currently an influx of producers and DJs experimenting with new expressions of independence: Issue 120 cover star Anz, and her new label OTMI, through to the likes of Sherelle, who runs label Hooversound with pal and fellow DJ Naina, alongside a shiny venture entitled BEAUTIFUL: a label and platform for Black and LGBTQI+ artists. Plus, of course, the countless array of globe-spanning producers who utilise Bandcamp‘s Bandcamp Friday initiative. Of these, Wyatt D Stevens, the New York-based producer, audiovisual artist, label head and filmmaker who releases music under aliases MoMA Ready and Gallery S, is among the most prolific. 

“Self-releasing projects allows me to maintain autonomy over my work, in a way that’s not possible with a major label,” says Stevens. “Labels have resources that artists don’t, but I believe a strong independent team can be just as effective as a major label for an artist.”

Interestingly, Stevens isn’t sure that his impressive work rate – 33 releases in 2020 spanning label compilations, mixes, albums and EPs – would have been possible if he was signed to a label. The admin involved, including the structuring of release schedules, packaging, media and distribution, would have been too much.

“As an independent artist, I can drop something whenever I feel like it,” he explains. “Maintaining that control is important to me.” This kind of fluidity and ownership is seldom associated with traditional contracts and label signings, which often tend to feel a little less fluid and adaptable, especially for Black artists. 

In the spring of 2021, the UK Parliament’s DCMS (Digital, Culture, Media And Sport) committee concluded a four-month-long inquiry into the economics of music streaming. The committee met seven times during the inquiry, hearing from representatives across the industry: the majors – Universal, Sony and Warner – the streaming services, artists and more.

During the hearings, MPs were warned by artists that the low payments made available through streaming were “threatening the future of music”, while Radiohead guitarist Ed O’Brien argued that, in the wake of the pandemic, “young musicians who rely on live income are really going to struggle.” SNP’s John Nicolson accused David Joseph, Universal Music UK chairman and chief executive, of “living in cloud cuckoo land” after Joseph claimed that artists were “very happy with the investment, very happy with advances” they currently receive through existing business models.

Curiously, out of all of the label executives called in by the committee, Joseph was the most open to discussions and ideas surrounding streaming reform. In fact, he appeared to (almost) back a user-centric payments model in response to a question from Nadine Shah following a testimony she delivered. “If you just listened to Nadine Shah that month, there would be models the services can do just to pay that artist rather than be diluted, perhaps, with all the popularity in the label pools,” he said. “There’s lots of ways we can approach this. Streaming is not perfect yet. I’ve got tons of ideas of how to improve streaming for the artists.”

 

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One company already attempting to improve streaming for artists and fans alike is SoundCloud. Founded in 2007, SoundCloud has long been heralded as an artist-first audio platform. Like many platforms, it has had its issues, from surges in international popularity to company restructuring and major leadership changes. Still, SoundCloud remains incredibly popular. For independent artists in particular, it’s still a go-to way to disseminate music among fanbases. 

Around two and a half years ago, Mike Pelczynski, SoundCloud’s head of rights administration and strategy, started architecting a new pay-out model that’s now known as fan-powered royalties. Essentially, it’s SoundCloud’s response to the changing needs and demands of its users. In particular, the nearly 100,000 artists monetise directly on the platform through SoundCloud Premier, Repost by SoundCloud or Repost Select. Fan-powered royalties were announced in March 2021, and rolled out to artists on 1 April. 

There were several major discussions to be had during the model’s development. For example, the team needed to work out whether SoundCloud even had the consumer base to support such an idea and a shift in business model, and, if they did, “how do we build it [so] that it’s dynamic and captures all of the complexities?” To tackle the latter question, they designed a visual element to its new ‘insights dashboard’. (This is where artists can see the fans interacting with their music.) “The one person that listened to you the most, you can actually see them, connect with them,” explains Pelczynski, adding that these new features not only increase transparency (as artists are fully aware of who is purchasing their music) but can also steer future plans and influence other projects.

This means artists utilising the model can plan tours, or target their products – like merchandise – towards markets and audiences that are receptive to their work at any given time, or have connected with a certain project more than others. Increasing dedicated audience bases but also income at a time where many have been dealt extreme losses. It also offers independent and rising artists another way to work on their own; taking charge of their own marketing campaigns, in some ways, a side of the business that may feel daunting to those without prior industry knowledge. 

Coincidently, that same month the streaming giant Spotify launched its Loud & Clear initiative: a digital portal designed to increase transparency on the music streaming economy with a focus, naturally, on Spotify. It includes resources for artists and professionals that break down the royalty system, key players and other processes. For instance, a look at revenue generation over the years, highlighting how many artists globally generated how much – across recording and publishing for their catalogue – for each of the last four years on Spotify. Loud & Clear launched following a string of Justice At Spotify protests in over 31 cities, organised by the Union of Musicians and Allied Workers. (Among other things, the campaign called for a user-centric payment model, and at least one cent per stream).

Speaking on the inspiration behind Loud & Clear, Bryan Johnson, Head of International Artist and Industry Partnerships, says, “We believe artists deserve more clarity around how the music streaming economy works – and, of course, the opportunity to earn more. This site is a clear indication of our intention to increase transparency by sharing new data and information on the global streaming economy, breaking down the royalty system and pivotally, fostering an increased understanding between Spotify and the artist community”.

Johnson goes on to state that the site is “just the beginning” in ensuring complete transparency throughout the streaming business, with Spotify aiming for Loud & Clear to be viewed as “a signal that we are collectively looking at being part of a constructive conversation, which has been previously lacking between Spotify and the industry on the topic.” He admits that the site is not the end of the issue – instead dubbing it the “beginning of a constructive conversation” – but ultimately hopes that the data and statistics made available through the site will demystify some of the business practices general audiences and musicians haven’t been able to explore in depth prior.

Given the changes among the DIY imprints and independent artist circuit, plus the shifts among the streaming services, it makes sense that processes are changing within the larger labels, too. Or in the case of BMG, the hybrid music companies. (BMG describes its work as combining the “activities of a music publisher and a record label”.) It also cites its core values as “transparency, service and fairness”. 

“There are no hidden agendas and it’s a simple concept: do right by the artist,” Mark Fabish, BMG’s International Marketing Director explains over email. 

“The BMG approach is definitely needed,” he adds. “There’s been negative press about the music industry for years, regarding unfair contracts, the lack of transparency when reporting and generally artists feeling neglected. There have been lots of articles that discuss transparency being one of the biggest threats to the music industry. It makes sense for a new music company such as BMG to operate differently – in a way that is in the artist’s best interest. This artist-centric approach is key to the success of the company.”

BMG is attempting to put its values into practice through a review of all historic contracts tied to previous label buyouts. In June 2020, the firm pledged to address historic inequalities in the record contracts of Black musicians. As Music Business Worldwide reported, BMG CEO Hartwig Mausch stated that the company was “mindful of the shameful treatment of Black artists” in an email sent to managers and performers. 

“While BMG only began operations in 2008,” Mausch continued, “we have acquired many older catalogues. If there are any inequities or anomalies, we will create a plan to address them. Within 30 days.”

Last year, BMG published results from the first stage of its investigation into these historical inequalities. It said that it found a “statistically significant negative correlation between being Black and receiving lower recorded royalty rates” on four of the 33 labels in its historic acquired catalogues. The difference ranged from from 1.1 to 3.4 percentage points.

In a similar move, Sony Music Entertainment recently pledged to waive unrecouped legacy artist debts. Artists who signed to the major label before 2000 and didn’t recoup their advances will be eligible to profit from their recordings for the very first time, as part of Sony’s new Artists Forward initiative. The scheme is aimed at “prioritising transparency with creators in all aspects of their development”, and covers this new pledge; part of its ‘legacy unrecouped balance programme’. 

 

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Other labels are taking a different tack. In January, Big Dada – the UK label distributed by influential indie Ninja Tune – announced its relaunch as an imprint dedicated to Black, POC and minority ethnic artists.  It marked the start of a new chapter for the already culturally-significant imprint, which has previously released music from artists such as Hype Williams, Roots Manuva, Congo Natty and the late Ty. 

“It feels like a radical shift in the way this industry has been operating,” says Big Dada’s Ashley Yun. “To be able to turn intent into action with a group of like-minded individuals is truly so special and I hope it inspires more companies and industry peers to take steps toward an equitable workforce and industry. I hope that this industry continues to address moments of necessary change, so that the next generation can step into a more level playing field.”

The label refresh includes an array of internal aims (like mentoring staff in areas that they are interested in, but may not be their main role within the company). It also includes a new website created to give back to as many artists that come into contact with Big Dada as possible – whether they are signed to the imprint or not. “[It] features a resource section offering these artists different music industry tips, from general music legal advice, distribution, funding, to links to mental health resources for Black and POC artists and how to release your music independently,” adds Bianca Renzullo. 

Big Dada’s already published several think-pieces and long reads with the aim to explore and share a whole variety of experiences, music scenes and movements. The team hopes to grow it into a kind of community hub that supports and empowers Black and POC voices. 

"I hope that this industry continues to address moments of necessary change, so that the next generation can step into a more level playing field"
– Ashley Yun, Big Dada

This means artists and creatives, or those who wish to engage with music and electronic music culture from afar, will have somewhere they can turn for content that feels catered to them and their experiences – musical, personal or otherwise. They’ll also be able to check out Sherelle’s new platform BEAUTIFUL. It’s inspired by Sherelle’s own personal development, and her experiences as a young, Black and queer creative navigating her way through viral fame and the day-to-day industry grind, while also addressing “ownership, wealth and building and maintaining community”. [sic]

“Having the necessary tools to have a fair chance in this scene is the key to creating the stars of tomorrow,” explained Sherelle in an announcement post for the project. “BEAUTIFUL will build on this legacy. I want to use BEAUTIFUL’s influence to create something for the better. BEAUTIFUL will plan to connect many Black electronic artists from in and around Europe and also the world via the label, building our fan-base and workshops.” [sic]

As more and more artists like Sherelle, or crews or small-scale labels opt to set out on their own – or decide that the independent route is their prefered path to success – they bring an array of fresh perspectives and approaches into an arguably stale sector. The result? New labels, projects or collaborations, formed by artists working on their own terms, untethered to structures that haven’t served them nor their peers in the past, becoming, as Elijah puts it: “the stars of the ’20s on their own terms.” In turn, impacting the majors and other larger, more established music firms, who are forced to evolve if they wish to continue on into the future as valuable as they’ve been in earlier years. 

“The power dynamic people have in terms of ownership and control of the music and narrative around it has needed to change for a long time,” says Elijah. “I try to back people and ideas that I feel will be catalysts for shifting this.”

“The barrier for most people starting their own ventures is a lack of finance, not just a lack of information. I will tell anyone that asks how we press records and get music out,” he explains. “All of the labels, collectives – however you define your outlet – created post-pandemic will be formed with the widest access to information of all time.”

Continuing, he adds: “The gatekeeper era at the lower level is coming to an end. You’ll see more owners, creators, founders like Anz, Sherelle and Naina and LCY and it will change who can participate, who feels welcome, and who is on the dancefloor. I’m excited to see and hear what happens, and we will try and help people in whatever way makes sense to make a fairer scene.”